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Implications of Court Ruling Net Neutrality Appeal Premature

On a technicality, the DC Court of Appeals ruled that Verizon's January appeal of the FCC's December Open Internet order was filed prematurely, meaning Verizon must wait for the FCC to officially post it in the Federal Register, before it can re-appeal.

This decision has tactical implications about where and when this appeal will be heard, but it has little to no effect on the merits of Verizon's appeal or the merits of the FCC's order.

While technically unsuccessful in accelerating their appeal, Verizon was very successful in establishing early how legally vulnerable the FCC decision will be on the merits, in whatever appeals court ultimately hear the case, (which still could be the DC Circuit where the FCC lost in Comcast vs. FCC, albeit with a different panel.)

Moreover, this technicality does nothing to change how politically controversial the FCC's Open Internet Order is.

The U.S. House of Representatives is expected to vote soon to pass a Resolution of Disapproval of the FCC Open Internet Order given that the House has already voted 244-181 to withhold funding for implementation of the FCC's Open Internet order.

Given how unusual it is for one chamber of Congress to oppose an independent agency's rulemaking, this is powerful evidence that the FCC's "solution in search of a problem" remains highly controversial and way outside the normal boundaries of agency rulemaking.

In sum, opposing sides are already in a rugby scrum waiting for the FCC to throw the legal appeal back in play. When they do, there will be a rush for Verizon and other opponents to re-file their appeal in the DC Circuit, which is the normal Appeals Court for FCC decisions, and for FCC supporters to try and appeal where they hope to get an appeals court panel sympathetic to giving the FCC the benefit of the doubt.

Regardless, two things are quite clear:

First, there will be continued legal uncertainty hanging over the sector as the very-legally-vulnerable FCC order appeal winds its way through the appeals court process in 2011 and then possibly again through the Supreme Court appeal process -- possibly in 2012; and

Second, there will be continued political controversy over the FCC's order and new un-authorized de-competition policy that preemptively regulated an industry with no significant evidence or credible justification.